Nick Clegg has joined calls for Russia to face the axe as hosts of the 2018 World Cup as part of tougher sanctions over the shooting down of Malaysia Airlines flight MH17 over eastern Ukraine.

The deputy prime minister said it was "unthinkable" at present that the tournament could go ahead in the country blamed by the west for supplying arms to the separatist rebels accused of causing the deaths of all 298 on board.

Football's world governing body Fifa this week ruled out calls from some German politicians for Russia to be boycotted, insisting the tournament could be "a force for good".

But Clegg told the Sunday Times that allowing it to go ahead without a change of course by president Vladimir Putin would make the world look "so weak and so insincere" in its condemnation of Moscow's annexation of Crimea and support for the rebels.

The EU has added another 15 individuals and 18 entities to the list of those subject to asset freezes and ambassadors in Brussels are expected to extend the punitive actions to state-owned banks' access to capital markets and to the arms and energy sectors.

Clegg said however that sporting events should also be part of the package of measures – including the cancellation of Russia's first F1 Grand Prix, which is due to take place in Sochi in October.

"Vladimir Putin himself has to understand that he can't have his cake and eat it," he said.

"He can't constantly, you know, push the patience of the international community beyond breaking point, destabilise a neighbouring country, protect these armed separatists in the east of Ukraine and still have the privilege and honour of receiving all the accolades in 2018 for being the host nation of the World Cup.

"That's why I've come to the view that if he doesn't change course it's just not on, the idea that Russia will host the World Cup in 2018.

"You can't have this – the beautiful game marred by the ugly aggression of Russia on the Russian-Ukrainian border.

"Not only would Vladimir Putin exploit it, I think it would make the rest of the world look so weak and so insincere about our protestations about Vladimir Putin's behaviour if we're not prepared to pull the plug.

He said that despite F1 boss Bernie Ecclestone's insistence that there was no case for abandoning the Grand Prix, "the question marks I'm raising will only increase over the next coming weeks and months, over the summer and up to the Grand Prix, about Russia's entitlement to host these major events.

"Vladimir Putin is a past master at attending these sporting events and, sort of, pretending almost as if everything's utterly normal and nothing untoward is happening around him.

"And if anyone needed any reminding of how dangerous this conflict is in the heart of Europe, just ask any of the family and relatives of those loved ones they lost in that plane incident last week."

Clegg said the threat of withdrawing the World Cup would be "a very potent political and symbolic sanction".

"If there's one thing that Vladimir Putin cares about, as far as I can see, it's his sense of status.

"Maybe reminding him that you can't retain the same status in the world if you ignore the rest of the world, maybe that will have some effect on his thinking."

He did not rule out the UK as an alternative host given its recent history of putting on successful global sporting events.

"We've got the stadiums, we've got the infrastructure, and we've got the public backing and enthusiasm to host it," he said.

"That's a decision for other people. But I'm not saying this just as a, sort of, British land grab to snatch the World Cup from under Vladimir Putin's nose."

He backed joined David Cameron's criticism of a French deal to supply warships to Russia, saying it would be "wholly inappropriate" for it to proceed in the present circumstances.

"Whilst I can entirely understand that the French may have entered into that contract with the Russians in entirely different circumstances, it is wholly inappropriate to go ahead with that now," he said.

"And as you know, the Prime Minister has reviewed the outstanding licenses that we have got to make sure that we deliver what we unilaterally announced back in March, which was that there would be no exports from Britain of arms products which could in any way fuel or fan the flames of the conflict in Ukraine."

He said he had been assured by business secretary Vince Cable that "great care" was taken to check the remaining licences.

Clegg predicted that any adverse effects on EU member states of tougher economic sanctions against Russia would be "probably not very significant" and urged all countries to consider the wider benefit.

"We are now moving, I think, towards a situation – and both the prime minister and I would be united in this – in saying to other European Union leaders, look, even if this incurs short-term political damage to this economy or that economy, this sector or that sector, there is something bigger at stake here and it is the stability of the European continent."

Clegg said the furore over the £160,000 paid in a Tory fundraising auction by the wife of a Russian oligarch who was a minister in Putin's first government for a game of tennis with Cameron and Boris Johnson mostly demonstrated the need for reform of political party funding.

"They need to make their own judgments," he said, when asked if his coalition partners should meet Labour demands to repay the money.

"But all parties ... continue to be damaged because of the haphazard way which we have to go around fund raising," he added – calling on both main parties to stop blocking reform.